OBAMA: We've got to grow the economy even faster, and we've got to put even more people back to work.

MORAN: Refocuses the presidential race on the struggling economy. The big questions: Can President Obama turn the economic tide before November? Can Mr. Romney convince voters he can do better? Two governors debate those questions, potential Romney running mate Bobby Jindal and key Obama ally Martin O'Malley. Jindal versus O'Malley, only on "This Week."

Plus...

ROMNEY: It's a tax. They decided it was constitutional, so it is a tax and it's unconstitutional.

MORAN: More fallout from the Supreme Court's health care decision.

Our third heat wave...

(UNKNOWN): In Philly, 103.

MORAN: ... and a record heat wave have people asking, dog days of summer or evidence of global warming? That, plus all the rest of the week's politics on our powerhouse roundtable with George Will, E.J. Dionne, Gwen Ifill, Mort Zuckerman, and Steve Rattner

MORAN: Good morning, everyone. George Stephanopoulos has a well-deserved morning off. Hopefully, he's cooling off somewhere.

Big news this week, that depressing jobs report, new evidence of a struggling economy, truly. And that means more questions about whether President Obama or Governor Romney is the best man to fix things. Our guests are ready to continue that debate, so let's get right to it, Louisiana's governor, Republican Governor Bobby Jindal, and Maryland's Democratic governor, Martin O'Malley.

Thank you both for being with us.

O'MALLEY: Thank you, Terry.

MORAN: Governor O'Malley, let me begin with you.

JINDAL: Thank you, Terry.

MORAN: And let's -- let's not mince words. The economy stinks. Let's take a look at the trend. This is not just a one-month blip. Look at these numbers. There is the first part of the year. The second quarter, 80,000, 77,000, 68,000. That's the worst quarter of job creation in two years.

So, Governor O'Malley, how does President Obama, how do his supporters answer a voter who says, "You inherited a terrible mess, granted. We hired you to fix it, you failed. You're fired"?

O'MALLEY: Well, I think what you have to look at is where the president started from. I mean, we faced the biggest job losses since the Great Depression. That's what George W. Bush and his failed policies left to us.

We've now put together as a nation, under President Obama's leadership, 28 months in a row of private-sector job growth. Would we like it to be happening faster? You bet we would. And we also have to I think admit that the Tea Party Republican Congress has done everything in their power to try to stall this jobs recovery and slow it before the election.

And you know what? Perhaps they might succeed. But our direction remains a direction forward. And no one can argue the fact that last year we created more jobs than were created in all eight years of George W. Bush, and that happened in 2010, as well.

So, look, we need to keep moving forward. And it would be great if the people of our country make a change, get rid of this do-nothing Congress, and put in some people that will work to create jobs, as the president has urged.

MORAN: So, Governor Jindal, what about that point, this is forward motion, it is job creation, and more, overall, than the Bush administration created?

JINDAL: Well, Terry, let's actually look at the facts for the whole four years now, three-and-a-half years where President Obama has been president, we've lost nearly half a million jobs since this president was elected.

O'MALLEY: Not true.

JINDAL: You look at his numbers, you look at -- at family income, median family income has now decreased now under this president over $4,000, median family worth, two-decade low. By any measure, his policies have been a failure.

The president himself said at the beginning of his term, he said give us three years. If we can't turn this around, this will be a one-term proposition. President Clinton went to Ohio two years ago, 2010, said give us two years. If we can't turn this around, throw us out of office.

Let's -- look, the president himself, his administration himself said this word that words matter. Let's take them at their word. Their policies aren't working. Albert Einstein said it best. Insanity is doing the same thing over and over and expecting different results.

He passed an $800 billion stimulus package, promised that unemployment would be below 8 percent. It's been above 8 percent for 41 straight months. If we were where they told us we would be -- they told us we'd be at 5.6 percent unemployment under his stimulus -- you would have 8 million more Americans working today than is actually the case.

Look, kids come out of college, half of them are going to be underemployed, unemployed, 23 million underemployed, unemployed Americans. However you measure this, this economy is not growing. This president's policies simply aren't working.

MORAN: It's tough. And, Governor O'Malley, one of the tough things for the president, as Governor Jindal points out, is that he made promises, so he's had to come before the American people and explain what went wrong. Republicans are having a field day with this. Here's Karl Rove's group, Crossroads GPS, an ad that they have put together with some of those statements. Take a look.

OBAMA: Headwinds coming from Europe. We've had a string of bad luck. An earthquake in Japan, an Arab spring. An ATM, you don't go to a bank teller. Some things that we could not control. You go to the airport, and you're using a kiosk. We've been a little bit lazy, I think, over the last couple of decades.

(END VIDEO CLIP)

MORAN: You know, Governor O'Malley, obviously, that's political ad, but doesn't Barack Obama own this economy?

O'MALLEY: Well, I think what he owns is the leadership of our country forward. What he owns is the responsibility to do everything in his power to dig us out of the hole that we found ourselves in.

And, look, President Obama is not running against the almighty. He is running against the alternative. And the alternative in this case is Governor Mitt Romney, who had the 47th worst job creation rate as governor and also has a -- a penchant, a talent for offshoring American jobs, sending them overseas, and also maintaining offshore bank accounts in Bermuda, Swiss bank accounts. And so the question he'll have to answer, Terry, is what is his alternative?

I've never known of a Swiss bank account to build an American bridge, a Swiss bank account to create American jobs, or Swiss bank accounts to rebuild the levees to protect the people of New Orleans. That's not an economic strategy for moving our country forward.

MORAN: All right. Just for the record, I did ask you about President Obama and you ended up attacking Mitt Romney. We...

O'MALLEY: Because this is a choice, Terry, between two gentlemen. Look, President Obama's talked about what we need to do as a nation. It's what our parents and grandparents did, to invest in our country, to believe enough in her to invest in education, in our infrastructure, and also in innovation. That is not the proposal that Mitt Romney has. He wants to make it even easier for very wealthy people to avoid paying taxes, to offshore American jobs, and to maintain their Swiss bank accounts while our roads and bridges and levees crumble.

MORAN: OK. Let -- let me pick up on some of that with Governor Jindal. Mitt Romney does spend most of his time attacking President Obama. That's the nature of this campaign right now. But when he does put forward his own program, in broad generalities, he talks about cutting taxes, especially for the very rich, cutting corporate taxes, deregulation, especially for the financial sector, because apparently they don't need any more regulation. And what do you say to a voter who says that is the precise recipe that cratered the economy in the first place when Bush and the Republicans were in power and cooked it up and ruined everything in the first place? What's the answer to that?

JINDAL: Well, Terry, sure. First of all, let's look at the actual policies he's proposing. And let's correct some of the misstatements that we've just heard. The reality is, we can't afford -- we've got up to over $15 trillion of debt. We can't afford to continue on the same path we've been. You look at Mitt Romney's record when he was governor of Massachusetts. Unemployment rate, it was below 5 percent. Per capita income growth, higher than the national average, their unemployment below the national average, ranked one of the top 10 turnaround states, so he's got a great track record both in the private sector, governor of Massachusetts, creating jobs in the private sector...

JINDAL: Absolutely. Absolutely. Listen to the policies he's actually outlined. He has said we need a lower, flatter tax code, so we need to cut individual tax rates 20 percent. We need a corporate tax rate that is competitive in the world. We now have the highest corporate tax rate in the entire industrialized world.

But he's also said, let's take away some of those loopholes, those deductions, especially for high-income earners, so we're not growing our December.

Secondly, he says let's produce more energy at home. Let's approve that Keystone pipeline, over 100,000 jobs there. Let's do more domestic energy production in the gulf and elsewhere in this country. Let's produce more oil and gas, especially from shale plays, already created over 600,000 jobs, could create another 250,000 jobs, will help secure manufacturing jobs in the steel industry, in the plastics, in the fertilizer industries.

Third, he -- he has also said we can't afford all of this spending. You know, President Obama created a new entitlement program, and we can't afford the entitlement programs we've already got. Mitt Romney has said let's repeal and replace Obamacare, get rid of those over 20 tax increases, $500 billion in tax increases, $500 billion in Medicare cuts, a program the president promised to protect, making cuts now that (inaudible) says are not sustainable, not realistic.

MORAN: OK.

JINDAL: So Mitt Romney has already said on the first day he would not only cut taxes, he would also rein in spending and stop all of these regulations that are killing jobs, while at the same time regulating Wall Street in a prudent way.

MORAN: Well, OK, so, Governor O'Malley, this is a forward-looking program, according to Governor Jindal.

O'MALLEY: The Romney program?

MORAN: Yes.

O'MALLEY: You mean the health care program that Governor Romney passed?

MORAN: No, the whole economic recipe.

O'MALLEY: Oh, the economic recipe. That would say -- or an economic recipe for disaster. And it's been proven. You want to talk about insanity, doing the same thing over and over again? You know, nostalgia is not want it used to be. I don't think most Americans want to go back to the days of George W. Bush, record spending increases, record deficits, record unemployment, record job losses.

I mean, the fact of the matter is, while we would all like the recovery to be happening faster, unemployment is lower now than it's been in three years, home foreclosures are now lower than they were before President Obama took office.

Look, the direction's clear. We need to move forward. And we need for the Republican Party, the party of Lincoln, to reclaim their party from the radical Tea Party Republicans that would rather kill our economy than -- in order to try to score points in this election rather than move forward.

MORAN: It may be a tough sell for voters to say that the economy is doing as well as you point out.

O'MALLEY: No, I'm not saying -- I'm saying, look, this is hard. The economy is moving in a better direction than it was, but it needs -- the acceleration needs to happen, and that requires both parties to work together for the common good.

MORAN: You know, Governor O'Malley, you raised something I want to raise with Governor Jindal, and that is something the Democrats are going to talk a lot about. Voters still aren't really sure of who Mitt Romney is, and this week, there were two major articles, Vanity Fair, Associated Press, taking a look at his fortune. And as you pointed out, he had a secret company in Bermuda. Not a lot of Americans have that, 12 offshore tax haven funds in the Cayman Islands and that Swiss bank account.

Let me go to Governor Jindal. Is it fair for voters to consider, Governor, what Mitt Romney does with his money outside the United States?

JINDAL: Terry, a couple -- I'll definitely answer that question. A couple things that I just want to again correct...

MORAN: No, no, no...

JINDAL: If you heard my friend, Governor O'Malley -- I will get to that question, but, look, Governor O'Malley, he's talked about President Bush several times now. That election was eight years ago. This election, this is a choice between President Obama and his failed policies and Governor Romney. This past week, David Axelrod tried to run against President Nixon. This is not about the past. This is about the future. Secondly, this...

(CROSSTALK)

JINDAL: ... Governor O'Malley is angry at Congress. He needs to be angry at the American people. They elected this Congress to stop some of these Obama policies. And this Congress, by the way...

JINDAL: They passed policies to rein in the NLRB. In terms of Governor Romney's financial success...

MORAN: Yes.

JINDAL: Look, I'm happy he's a successful businessman. We've got a president today who's never run a business, never run anything including a lemonade stand before he was president of the United States.

O'MALLEY: Governor, what about the Swiss bank accounts?

JINDAL: We can't afford four more years of on-the-job training. Look, the bottom line is, I'm thrilled that Mitt Romney has been successful in the private sector. I want somebody who's got that private-sector experience...

MORAN: But what about his money out of the country?

(CROSSTALK)

MORAN: Is it OK -- is it OK for voters to consider the amount of money that he's put out of the country in tax havens offshore, in secret Bermuda companies? Does that make sense for voters to consider?

JINDAL: Look, I think -- I think voters will consider all of the distractions thrown out by the Obama campaign. But at the end of the day, this election is about two fundamental choices. It's about President Obama, who wants to continue to spend money we don't have. They incurred now $1 trillion-plus deficit every year he's been president, after he promised we'd cut the deficit in half by the end of his first term. He hasn't done that. Promised unemployment would be below 8 percent, hadn't done that, promised he'd reform the entitlement programs, hasn't done that.

We're going the way of Europe. You may have noticed a couple of weeks ago, the German finance minister actually lectured the America -- actually lectured the American president about borrowing. He said, don't tell us what to do until you get your house in order. It's pretty embarrassing when the Europeans are telling us we're spending and borrowing too much...

MORAN: And -- and with those problems...

(CROSSTALK)

JINDAL: There will be a lot of distractions from the Obama campaign...

(CROSSTALK)

MORAN: And with those problems...

JINDAL: But this is about two fundamental choices.

MORAN: Got it. So, Governor O'Malley, it is a distraction, according to the Republicans. This is really just sand in the eyes of the American voter.

O'MALLEY: Oh, it's not a distraction at all. Look...

MORAN: What's the relevance? What's the relevance?

O'MALLEY: The relevance is this, that Governor Romney can't can claim that his state actually was great at creating jobs when he was governor, so he's falling back and said, look, vote for me, I was a businessman, I created jobs.

You want talk about going the way of Europe? What went the way of Europe were the -- the Swiss bank accounts and the American dollars that Mitt Romney stuffed in that offshore Swiss bank account, jobs that he facilitated companies in moving offshore, out of places like Ohio, out of Pennsylvania and Maryland.

I mean, this is a fundamental disagreement between two different candidates and their vision for our country's future. Barack Obama believes enough in our country to be willing to work for and invest in it. Mitt Romney bets against America. He bet against America when he put his money in Swiss bank accounts and tax havens and shelters and also set up a secret company, the shell company in Bermuda, which, by the way, in order to avoid disclosure, he put in his wife's name right before he became governor of Massachusetts.

These are legitimate questions that a man who is holding himself out as wanting to lead our country forward needs to answer. He doesn't have an economic policy. And his track record in business was to offshore American jobs and to set up secret bank accounts offshore to shelter his own fair share of paying taxes to make our country stronger.

MORAN: All right, I'm going to let Governor Jindal have a brief last word on that.

JINDAL: I need to respond to that real quickly. Three things. Under Governor Romney, they did create jobs in Massachusetts, top 10 states turned around, unemployment below 5 percent. I'd love to see that for the country right now.

Secondly, independent fact-checker organizations have made it very clear these claims are false about the outsourcing of jobs when Governor Romney was at Bain.

But, third, look at this president's policies. Just this week, a political attempt to try to do something about China, Mitt Romney has said on the first day he would declare them a currency manipulator. Democratic Senator Sherrod Brown in Ohio -- Democratic senator said, look, this Treasury Department has not done enough against the Chinese. Mitt Romney will create jobs right now in America. I don't blame Governor O'Malley for trying to change the topic. They can't run on the president's track record...

O'MALLEY: Oh, I'm not changing the topic.

(CROSSTALK)

MORAN: OK. All right, gentlemen, we're going to have to leave it there.

(CROSSTALK)

MORAN: That will -- that will be the last words, I guess. And, Governor Jindal and Governor O'Malley, thanks very much for being with us this morning.

O'MALLEY: Thank you, Terry.

MORAN: Well, don't go anywhere. Our powerhouse roundtable is coming right up in just 60 seconds.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

(UNKNOWN): Those jobs numbers, and as one economist said today, this country is stuck in quicksand.

(UNKNOWN): Stocks sinking following the weaker than expected June jobs report.

(UNKNOWN): Well, the headline from the June jobs report is disappointing.

FALLON: President Obama said Americans need someone who will wake up every single day and fight for their jobs. Then he said, but until we find that guy, I'm still your best choice. It's really...

(LAUGHTER)

(END VIDEO CLIP)

MORAN: If you're an incumbent president running for re-election, that's not the kind of joke or headlines you want to hear. Let's talk about it with our powerhouse roundtable. As ever, George Will is with us. Washington Post columnist E.J. Dionne, who has a new book out, "Our Divided Political Heart," it's called, the conflict between the individualism and community in American politics. Looks very good.

From PBS, the host of "Washington Week," Gwen Ifill is with us. Steve Rattner, former automobile czar in the Obama administration and investor. And Mort Zuckerman, the editor of U.S. News and investors.

Well, so let me begin, George, with you. How bad is it? How bad is it in reality? How bad is it for President Obama?

WILL: It's bad, bad, bad across the board. We're now in the fourth year of a recovery, which if 7 million people had not left the workforce, so the workforce participation is way down, we would have 10.9 percent unemployment and no one would be talking about a recovery.

It's quite clear the president got terrible advice early in his administration. First, his advisers said we'll do this stimulus and it will never reach 8 percent; 41 weeks now -- 41 months over 8 percent. But beyond that, they assured him that this was going to be a V-shaped recovery. Precipitous downturn, but a commensurate upturn. It turned out to be not quite an L-shaped, but more like a hockey stick, so that we're in what is now called properly a growth recession. We're getting some growth, but not enough to accommodate even the growth of the workforce.

MORAN: And let's go to our friends in the business sector, Steve and Mort. Mort, is this the new normal, this kind of struggle?

ZUCKERMAN: Well, it's certainly going to continue for a while. I think whatever has been tried, add a huge amount of deficit spending, has simply not worked, and so this is going to continue, I believe, for quite a while. And I don't see any way of getting out of it, because it's going to be very difficult now to improve the economy through additional fiscal spending. We are on the verge of being broke. You know, I think as some Hemingway novel, there was a guy who said, how did you go broke? He said, first slowly, and then suddenly.

We are -- we have to be very careful that people do not lose confidence in the American dollar, because we have to borrow huge amounts of money. It's not -- it's not sustainable, and it has not worked. So we're going to have to find a whole set of different policies that will work.

MORAN: Hmm. Steve, we're tapped out?

RATTNER: We are tapped out in a sense, yeah. We have to deal with the long-term deficit problem, as Mort said. There's no question about that. But in the short run, there are things that we can and should be doing to fix the economy.

First, I would not take issue with George's facts, but I'd take a little bit of issue with the packaging, in the sense that I would argue that the stimulus program, the financial rescue, the auto rescue all got us in a much better place than we would have been had none of those things happened.

The second point I'd make is you have to remember that a lot of this unemployment is coming from a few very defined sectors: government, which has cut employment, state, local federal; construction, home-building, not surprising. Even things like media, which some of you guys are in, have had flat to declining -- and finance, where Mort and I live, have flat to declining employment.

So when you have roughly a third of your economy either losing jobs or not gaining jobs, it becomes hard. So when you ask the question, is this the new normal, yeah, we face a bunch of headwinds, including the fiscal situation, including Europe, including the factors that I mentioned in those other sectors, including global competition and the effect that it has on our wages. These are massive problems, and we need to address them.

MORAN: And the buck stops, Gwen, with the guy in the office with no corners.

IFILL: Well, it does. The office with no corners, I mean, it's true, because in the end, no one really cares about the numbers and the excuses. That's why that Romney ad is actually kind of useful, because no president wants to be put in the position of always looking like he's on the defensive.

People care about whether they feel anxious or not, and people feel a great deal of anxiety. The choice they're making now isn't between whether they're going to have a job next month or their kids are going to have a job. Their choice is whether either of these guys is going to make their lives better.

And if they don't -- if Romney can't convince them that their lives will be made better, they'll just stick with the one they know. But if Obama seems like he's always on the defensive and can't -- no matter what we keep digging deeper, he is in peril.

So that's -- that's how voters talk to me about this. They don't talk about the numbers. They don't even say, well, you know, he saved the auto industry, unless you live in Ohio or Michigan, in which they think it's a great thing. But otherwise they're thinking, what about me? Did they save my kids' future? And that's not -- that's an open question at this point.

MORAN: You talk about headwinds, E.J., for the president.

DIONNE: Right. Well, you know, I mean, two things. One is, from the beginning, the stimulus should have been bigger. He cut it back partly to get votes in Congress. He had to cut it back further to get those last three Republican votes.

If you had simply the growth in government employment now that you had under Ronald Reagan, the unemployment rate would probably be a point lower. And so ironically, because the Republican control in local government, the pushback in the Congress, and the fact that Obama didn't go big enough at the beginning, you've got the unemployment rate higher.

I think the interesting question is, why is President Obama still ahead in these polls, and especially still ahead in the swing states?

MORAN: Why?

DIONNE: I mean, we've had this sluggish growth. And I think part of the problem for Romney is that he's making a very simple argument, which is things aren't working, Obama didn't fix them, try me.

And if the economy were actually falling, if there's ever a negative number in front of the jobs number, then President Obama is in big trouble. But at the moment, Romney isn't offering much except for tax cuts, cuts in regulation. And there is sort of a feeling that, well, that won't work. And so I think -- and Romney also is in trouble with a lot of switches in positions. So Obama is maintaining a lead in the face of pretty bad economic numbers. That's a really interesting fact about our politics.

WILL: Steve, like God in Genesis, has looked upon his work and found it good. His work (inaudible) was the auto bailout. But without re-litigating that, surely the stimulus was an exercise in faith-based economics. These were all communicants in the Church of Keynes, and they had this touching faith in the multiplier effect of federal spending. Well, it didn't multiply by the standards they enunciated.

(CROSSTALK)

DIONNE: All the evidence is that it grew jobs.

RATTNER: That's not really true.

(COMMERCIAL BREAK)

RATTNER: This has been studied -- this has been studied by bipartisan economists, Mark Zandi, Alan Blinder. I know -- the problem Obama has is he's trying to prove a counterfactual. He's trying to prove that without the stimulus it would have been worse. There's no way that we can all agree on that. There's no way that we can come to a consensus necessarily, but it has been studied.

And the fact is, as E.J. said, without the stimulus, you would have had much higher unemployment. Simply, imagine this. A third of that stimulus went to state and local governments that have to balance their budgets. They've already cut hundreds of thousands of workers. If they had not gotten that $300 billion, imagine how many people would have lost their jobs at those -- at the state and local level.

ZUCKERMAN: But the problem with that argument, if I may say, is that if that money had gone into some area of the economy where you would have had a job multiplier effect, which is what it didn't do when you're trying to save the so-called state and local municipal jobs, OK, we would have had a much better economy. That was a payoff, if I may say so, to the public service unions. That's where it was going. It was a political thing. And $400 billion of the $800 billion went to that area.

So I -- I disagreed with it at the time, because I said it was not going to work, and it didn't work. It didn't work well enough, and the president has to be held responsible. The great American job machine has now broken down. We are four years into a so-called recovery, and it is the worst recovery we've ever seen, and now we are -- we are looking at the possibility of a double-dip recession. This would be disastrous.

(CROSSTALK)

DIONNE: I just don't think it's true that there's no multiplier. Money in the hands of cops, firefighters and teachers is circulated through the economy. All the studies show the stimulus created jobs.

I think one of the great ironies, you've got a campaign here that's about, well, government is too big. The most interventionist policy -- I don't want to accuse an investment banker of being a statist -- but the most interventionist policy by the Obama administration, the auto bailout, is also the most successful. And I think one of the great ironies of this election is that if Obama wins by carrying Michigan and Ohio, bailing out or rescuing the car industry will be the key to his re-election.

MORAN: Well, as Gwen points out, that doesn't seem to have a lot of traction even in those states with voters who aren't involved in the...

(CROSSTALK)

IFILL: Actually, one of the great ironies of this election is that they're -- neither of these candidates is having this debate that we're having at this table. In fact, they're talking in circles around each other. And in the end, for most voters, this is a choice of alternatives. They may think that President Obama could have done more. They may think there should be more jobs created, but Governor Romney still has to prove that he is a reasonable alternative. That's always the choice.

MORAN: And it feels almost as if voters are saying neither one of them has the answer.

RATTNER: Let me just tell E.J. the secret of the auto bailout. The secret of the auto bailout is we didn't have to go to Congress. We did it using TARP money. We didn't have to go to Congress. It never would have happened with Congress. And I think that is a metaphor for the broader problem. Congress is doing nothing. They sit there with their 17 percent approval rating, and they pass nothing, and I think you have to put them in the mix as we debate who's responsible for this problem.

(CROSSTALK)

DIONNE: ... the Obama campaign is going to try very hard to tie them to Mitt Romney, and he seems to keep ceding ground to the Republicans...

(CROSSTALK)

ZUCKERMAN: Let me just say, while I'm sorry to interrupt, this country responds to presidential leadership, not to congressional leadership. With a different kind of leadership, I think we would have had a different kind of stimulus program and we would have different kinds of effects. That is the core issue of our government. It responds to presidential leadership, not to congressional leadership. And that's always been the case in this country.

WILL: E.J. sounds -- and it's an interesting point -- that in spite of all this bad news, it's essentially tied or Obama's slightly ahead. Let me remind you of 1980. A week before the election, when Reagan left to go to Cleveland for the one debate with Carter, ABC had Reagan ahead a little bit, Time magazine had Carter ahead a little bit. Statistical tie. A week later, Reagan carried 44 states. So the country will at some point decide -- they'll throw a switch and say this isn't working or this is the best we can do. I wouldn't be confident.

(CROSSTALK)

DIONNE: There were only three problems with that metaphor. Reagan -- Romney isn't Reagan, Obama isn't Carter, and hostages aren't in Iran. Otherwise...

(CROSSTALK)

MORAN: We're going to take a break right now. There's a lot more to come from our roundtable. We're going to talk about the veepstakes. They're heating up.

(BEGIN VIDEO CLIP)

PAWLENTY: Barack Obama's basic slogan for this campaign is, hey, it could be worse. Mitt Romney's slogan is it will be better.

(UNKNOWN): Doesn't it make you wonder what Mitt Romney is trying to hide from the American people?

(END VIDEO CLIP)

MORAN: And extreme storms, what's to blame?

(BEGIN VIDEO CLIP)

LENO: Hundred degrees in New York City. It was so hot, Mayor Bloomberg said, screw it, give me an extra large soda. I don't care. Give me the big...

(LAUGHTER)

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: Maybe you took a vacation every once in a while. And it wasn't necessarily some fancy vacation at some fancy resort. The best vacation I had when I was a kid was we traveled around the country on Greyhound busses and on t rains and we stayed at Howard Johnsons.

ROMNEY: You know, I'm delighted to be able to take a vacation with my family. I think all Americans appreciate the memories that they have with their children and their grandchildren. I hope that more Americans are able to take vacations.

(END VIDEO CLIP)

MORAN: Well, so do I. The battle of the vacations. We're back with more of our roundtable. And, George, this seems silly. Maybe it is. But it does go at something that is at work in this campaign, does it not, which is essentially a class conflict.

WILL: Well, they're trying to make Mitt Romney not likable. Peter Hart -- I've said this before -- Peter Hart over and over says go back -- all of the complicated metrics you want, go back to Truman against Dewey and Eisenhower against Stevenson, the likable guy usually wins. And they're trying to -- and so far has succeeded in making Mitt Romney's core argument, "I'm a business guy," a negative. The country doesn't look upon his business career in a happy way.

MORAN: And what they're doing with that business -- what do you guys think of this -- with the notion of going after his investments abroad, offshore accounts, and making that part of the argument against him?

RATTNER: Well, certainly it's part of the argument against him, because he's done things that the average American can't relate to, doesn't understand, doesn't think are fair. Look, I'm a private-equity guy, and I'm aware of some of these ways to use the tax code...

MORAN: Do you have offshore accounts?

RATTNER: But I have never -- I actually was with a very prominent private equity guy last night who said he'd never heard of some of the things Mitt Romney has done in terms of putting money offshore, in terms of having $100 million IRA, basically getting an interest-free loan from Uncle Sam on the taxes, on all that money, until he brings it home. And I think these are all -- I think these are absolutely fair game.

ZUCKERMAN: Well, I think what is fair game about Romney is that he was a very effective governor of Massachusetts. He was a very effective governor when he came to the Olympics in Salt Lake City. He has done a lot of things that shows that he knows how to manage situations.

And this one of the problems we have with a president who's never run anything. There are astonishing parts to that, including his inability to communicate with the Congress, which is just astounding when you meet people there who say they've never met with him in three-and-a-half or four years, since he's been president. Mitch McConnell, the Republican leader, with a front-page story in the New York Times, he hadn't had a single meeting or conversation with the president in 18 months. Government doesn't work that way. This president does not know how to work government. And that is critical.

IFILL: Well, you can argue whose fault these non-meetings are, but that's kind of off point. To me, it's 100 degrees in Washington today. I do not begrudge anyone a vacation. I would love to be on vacation on a lake right now.

MORAN: That boat looks nice.

IFILL: That boat looked kind of sweet. But what they are trying to do on the boat is that it was loaded up with his family. They're trying to make Mitt Romney more likable. Every time you see him, he's out -- sure, he's at a lakefront mansion, but he's with his grandchildren, who will obviously adore him. When you see the president talk about his childhood, bouncing up on beds in Howard Johnsons, and when you see him more interestingly in his speeches say, I see my daughters in you, he also is trying to make himself likable and playing up the things which are most normal guy.

This is what they do. Now, when you vacation at an estate in Martha's Vineyard, which the Obamas will not be doing this year, that takes away from this, so they will not be doing it.

MORAN: And windsurfing is a bad idea.

(CROSSTALK)

IFILL: And windsurfing, not so good.

DIONNE: One of the most interesting voter interviews I've had at this campaign -- I was with Joe Klein at a Gingrich rally in New Hampshire, way back at the beginning of the campaign, and there was a gentleman there, and we asked him, why are you for Gingrich over Romney? And he said Mitt Romney reminds me of John Kerry.

And I thought of that when I saw all of these -- this focus on the vacation, because we all remember, as you suggested, that the Bush people jumped on the windsurfing thing. Class is always used in American politics. And I think George underscored the essential point, which is Mitt Romney hoped that his experience at Bain Capital would be a political asset. Well, guess what? After all of this argument and all of this advertising, it's turned into a liability.

And it's especially a liability in the swing states. And it's partly because there are different ways of having capitalism in our country, and there are aspects of the way the private-equity business works, the way Mitt Romney's business works that don't sit well with Americans. And that's why we're having this big argument.

MORAN: And putting that on trial. Let's get to an issue, health care. The Romney campaign was all over the map again this week. Take a look at Romney's -- one of Romney's top advisers and then Mitt Romney himself cleaning things up.

(BEGIN VIDEO CLIP)

PERRY: The fact of the matter is, you're for individual mandates. And you can get up and stand up and talk about, you know, I'm against it now and I'm going to rescind Obamacare, I'm going to repeal Obamacare, but the record is very clear. And the question has been, who can stand on the stage, look Obama in the eye, and say, "Obamacare is an abomination for this country"?

(END VIDEO CLIP)

MORAN: All right, well, obviously, that was back in the Republican debates, but it presents the problem that Rick Perry presented very pointedly. Can a guy who had that health care program in Massachusetts take it to the president on this issue? He's having trouble.

WILL: He's having trouble, even with an assist from the chief justice who said -- sorted this out and gave him an intellectual framework for attacking it. He cannot make the case. He has not made the case. He wants to change the subject. And in this regard, he has the president's cooperation, because the president wants to change the subject. Neither side wants to talk about health care, which is a very interesting development.

IFILL: Well, both sides want to talk about taxes. And as long as they can take this health care debate and turn it into a debate about who will raise your taxes, that wonderful, old story that they drag out every four years, then that's what this debate is going to be engaged on. It was interesting this week to see the president actually step out on his campaign to start to defend his health care plan. He actually started to say what it would do and how it would help, instead of being on the defensive. So clearly they think they have an upper hand here.

DIONNE: I think that's right. I think that the Obama campaign now wants to talk more about those aspects of the health care bill that they didn't talk enough about before that are actually popular with people. But this was an amazing moment for Romney, because, you know, he did so many things wrong there. They should have had a position ready before the Supreme Court made a decision. They should have sort of worked this out. Why they had this fight with their own Republican Party was strange. It looked like he switched his position and caved to pressure from the Republican Party. And that plays into another narrative the other side is trying to build, and there -- it's hard to understand how the campaign got to that point.

ZUCKERMAN: But there have been two studies about what they call regulatory insecurity or political insecurity, one by Stanford and one by the University of Chicago. And both of them came to the conclusion that between 2 million and 2.5 million jobs were not created primarily because of the health care program and their concerns about it.

And look at just one thing in the health care program, which I find astonishing. Every company that has 50 employees or more is going to have to take on a new level of health care which is going to raise their costs by $70 a week per worker. Do you know what that's going to do to low-income and low -- sort of restaurants and the very labor-intensive jobs? It's going to be devastating. So nobody things about what the real effects of that health care bill are.

RATTNER: But, look, at the same time, Mort, the health care bill does do a lot of things. It takes care of the pre-existing conditions, children under -- up to 26, 30 million uninsured coming on the rolls. But fundamentally I agree with George, much to my -- I guess slightly to my surprise, which is...

WILL: And my chagrin.

(LAUGHTER)

RATTNER: I think that -- and your chagrin -- I think Romney potentially had an issue in health care, that he might have been able to do something with -- notwithstanding Massachusetts. He had had -- he sort of found a line that got him through Massachusetts and allowed him to get to Obama, and I think this past couple of weeks, between the Supreme Court and what he did on the taxes on the mandate, going back and forth and back and forth, over something that amounts to $7 billion in 2019 -- this is a tiny little thing he couldn't get out of his own way on it. I think he's lost his ability to press that issue.

MORAN: And there are Republicans who are very concerned right now about the way the Romney campaign is going. The Wall Street Journal, among others, are just hammering the Romney campaign right now. In an editorial -- this is the gospel of the conservative movement, in some ways -- in the Wall Street Journal editorial page, the Romney campaign thinks it can play it safe and coast to the White House. Mr. Romney promised Republicans he was the best man to make the case against President Obama, whom they desperately want to defeat. So far Mr. Romney is letting them down.

And that's just one place. George, how do you think they're doing?

WILL: Well, to be fair to the Romney campaign, at some point in every campaign, the people who are not included in the campaign, which is 90 percent of Republican activists, say we should be -- we could do it better.

IFILL: That happened a month ago for the Democrats.

(LAUGHTER)

WILL: So this is normal. On the other hand, the president does seem -- sorry, not the president -- Governor Romney seems to be risk-averse. He does seem to be in something like a four-corner stall in basketball, which almost killed basketball, and they put in a 30-second shot clock to change that.

But you can't get to the NCAA championship, you can't get to the presidency running out the clock. So he's going to have to do something more than say Obama's not working. And he said to CBS News this week, as long as I keep talking about the economy, I'll win.

IFILL: He did say that.

WILL: It's what you say about the economy and what hope you give to people.

DIONNE: The Wall Street Journal editorial paper attacking the Republican nominee, it's like George Will attacking baseball. This isn't supposed to happen. That's a bad week for a Republican nominee.

And I think, on the one hand, George is right. There is a risk aversion there. He just thinks if he just keeps talking about how bad the economy is, he'll win. But there's also a problem for some of the conservatives making this case, which is they want Romney to go all the way over to the right where they are. In my book, I talk about this radical individualism. And that's where they want Romney to be.

The Romney campaign knows that if they go that far right, they're going to lose some of the middle ground voters that they need to win. So there's a kind of -- they're both right and both wrong about this one.

IFILL: But if you're going to have a bad week, don't you want to have it be Fourth of July week rather than, I don't know, Columbus Day?

RATTNER: But it's a long-term problem for him, because I think it's more than just risk-aversion. I think it's suicide-aversion. Because if Romney actually starts talking about his economic plan and lays out clearly for the American people what he's in favor of, 20 percent across-the-board tax cuts that aren't paid for, privatizing Medicare and turning it into a voucher program, sending Medicaid back to the states as a block grant program, cutting a whole series of programs like food stamps by 33 percent, I'm not sure he's going to win the election if people actually understood what he's in favor of.

MORAN: (inaudible) let's close this up by talking about the vice presidential stakes, the veepstakes. I want to get your thoughts on who's out there. And this is the kind of process where everything goes into the pot for each one of the candidates being vetted and considered, including Governor Chris Christie of New Jersey. And Jake Tapper sat down with him for "Nightline" and talked to him about one of the issues that's probably in the calculation of whether he should be the vice presidential candidate. Take a look.

(BEGIN VIDEO CLIP)

CHRISTIE: Some people, you know, drink too much. Some people take drugs. Some people eat too much. See, you can go -- live every day without drinking. You can live every day without taking drugs. You can't live every day without eating. And I've struggled with it for the last 30 years, on and off. And I'm trying. It may not look like I'm trying sometimes, but I am.

(END VIDEO CLIP)

MORAN: It's a fact, weight is probably an issue, as is everything else. I just want to go around the horn. Who'd you like to see on the ticket? Who do you think will be there?

ZUCKERMAN: I think it'll be either Tim Pawlenty or Rob Portman of Ohio, Tim Pawlenty, of course, of Minnesota. I think Portman is a very strong candidate and may help him carry Ohio, which is a very, very critical state in the election.

RATTNER: I think Mort is probably right about that. I think the only real issue here is whether he picks something that is a mistake, like Sarah Palin, because, frankly, I don't think it matters that much. I think if you look at history, fewer and fewer times has a vice president actually helped a presidential candidate, even in his home state.

IFILL: I'm an agnostic on veepstakes, in part because we're always wrong, and in part -- not always, but often wrong, and part because, you know, Steve's right. It doesn't really matter. People are going to vote for the candidate, not for who it is. But this gives us something to talk about during the summer.

MORAN: It does. And it does tell us something about the candidate. It tells us something about McCain, right?

IFILL: Yeah. Yeah.

DIONNE: I could predict with absolute certainty it will not be Sarah Palin. And I think Sarah Palin looms over this whole process, which was why the choices are all safe. Portman is clearly the Washington choice. He may end up being the choice because of Ohio. But I think there's a competition between Pawlenty and Jindal. I still think Jindal is in it, and so he was kind of trying out for it today.

(CROSSTALK)

IFILL: ... Chris Christie, huh?

WILL: Steve's right. There's precious little political science evidence that this matters in electoral politics. It matters in American history, because 14 vice presidents have become president. So we ought to be careful about who we put there. Mitt Romney has been risk-averse. Mitt Romney needs an alternative narrative on health care. There are two people who give him that, and that is Bobby Jindal and Paul Ryan.

MORAN: All right. There you have it, those predictions. We'll have more of our roundtable in just 60 seconds, discussing this furnace heat that's out there, the record heat wave, and America's pastime at the All-Star Break. Stay with us.

(COMMERCIAL BREAK)

ZEE: Good morning. I'm meteorologist Ginger Zee in Central Park. What an extreme historic weather week it has been. The heat has been ferocious. Nationwide, around 2,000 record highs set this month alone. The middle of the country hardest hit, St. Louis with 10 consecutive triple-digit days. But it's not just the heat. Across the heartland, droughts and devastating crops prompting comparisons to the Dust Bowl of the 1930s and raising the prices you pay at the supermarket.

Out west, wildfires have claimed hundreds of homes and more than 2 million acres this season. And don't forget the storms, like last weekend's derecha windstorm that left more than 20 dead and millions without power.

Now, we know that one week of extreme heat cannot be called climate changes. However, the Associated Press wrote this week, this summer is what global warming looks like. But, Terry, the most important thing is we're finally going to get some relief this week, and that can't come soon enough.

MORAN: (inaudible) Ginger, thanks very much.

What's to blame for this extreme heat? We're back with the roundtable here. The thing that strikes me as odd is that -- is that we don't make neuroscience, brain surgery a political question, but we have made whether or not the climate is changing because of human activities an article of political face on both sides. That seems silly.

ZUCKERMAN: Well, I think there is probably the chance that weather has a broader application than brain surgery. I don't know why I come up to that conclusion.

(LAUGHTER)

But it's something that really affects, you know, the vast number of American people, so why shouldn't it be an issue, you know, particularly people losing their home? I mean, the great American dream has long been to have your own home in the suburbs, in particular. I mean, the great American dream may now be getting a job now, but it's still a key factor for every American.

MORAN: Climate change is a political issue.

DIONNE: Well, it is a political issue, because the question is, are you going to do something about it or not? And, you know, during heat waves, belief in global warming goes up, surprise, surprise, in the polls. But what's really -- what we've really seen is wild weather, not only here, but all over the world.

And what I don't understand is why people are so resistant -- why my conservative friends are so resistant in taking out an insurance policy. There is a lot of evidence that human activity is changing the climate. There's not a lot of dispute among scientists about this. Why wouldn't we want to take out an insurance policy to protect ourselves? Because if we go wrong on this, we're making an awfully big mistake.

IFILL: George?

(CROSSTALK)

WILL: You asked us -- how do we explain the heat? One word: summer. I grew up in central Illinois in a house without air conditioning. What is so unusual about this?

Now, come the winter, there will be a cold snap, lots of snow, and the same guys, like E.J., will start lecturing us. There's a difference between the weather and the climate. I agree with that. We're having some hot weather. Get over it.

RATTNER: Well, wait a minute. But wait a minute. But wait a minute. I agree with that. But the 10 hottest years on record have been in the last 12 years. The 20 hottest years on record have been in the last 30 years. There is a lot of science around this. The polar icecaps, everything we've all read, I don't think we can just ignore it, George. And it is an issue, because it's something that our political leaders need to do something about, unlike neuroscience.

MORAN: Is it an issue for voters? Is this salient? Is this even on the radar screen?

IFILL: I come back to my argument in favor of vacations. I believe this is what most voters are thinking about now. I don't think they're getting drawn into scientific or political discussions about climate change. They just want it to stop, and they want their power to stay on.

Now, of course there are -- there are ramifications for this. And none of this comes for free. I don't think that this election is going to be decided on it.

ZUCKERMAN: If we had a heat wave in November of this kind, it'll be part of the election.

(CROSSTALK)

ZUCKERMAN: I doubt if that's going to be the case.

MORAN: All right. Well, we do have right now this time of year, it's the All-Star Break, and we're lucky to have one of the great baseball minds with us. George, my Cubs not doing too well, but what do you think of the -- of where the season is?

WILL: Every baseball fan talks about the golden age of baseball, and it's always when he was about 12 years old. I have news for you: This is the golden age. Competitive balance is back. The Pirates haven't had a winning season in 20 years, 1992. They have the best record in the National League. They have the best new ballpark. They have the most exciting player in the National League in Andrew McCutchen in centerfield.

But more to the point, the product is selling. People are coming out as never before. In 1955, the Brooklyn Dodgers win their only World Series, great team, Robinson, Furillo, Hodges, Reese, all those guys. Whole city of New York loved them. They drew 13,500 a game. This year, the average attendance in baseball is 31,000 a game and going up. This is the golden age.

MORAN: The golden age of baseball.

ZUCKERMAN: Absolutely.

(CROSSTALK)

ZUCKERMAN: And in New York, I have to say, the New York Yankees are once again doing fabulously well, which is a great thing for...

RATTNER: Yawn.

MORAN: ... newspapers like...

(CROSSTALK)

MORAN: We're going to close it off on the Yankees. George Will, E.J. Dionne, Gwen Ifill, Steve Rattner, Mort Zuckerman, thanks very much for being with us.

"Your Voice This Week" is coming right up.

But first...

(BEGIN VIDEO CLIP)

MORAN (voice-over): Three moments from "This Week" history. What year was it?

(UNKNOWN): Somebody, possibly a terrorist, tried to blow up the World Trade Center.

MORAN: Al Qaida targeted the World Trade Center for the first time. The government siege of the Branch Davidian community's Texas compound ended with a fire claiming nearly 80 lives.

(UNKNOWN): How did the victims die? And how did the fire start?

MORAN: Plus, the political discussion.

GORE: Ask the wealthiest 1 percent to pay higher tax rates...

MORAN: Dominated by talk of the 1 percent and health care.

(UNKNOWN): Is it really possible to give full health care to everyone in the United States?

MORAN: Some things never change. Was it 1993, 1994, or 1995? We'll be back in a moment with the answer.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MORAN: So what year was it? When did Al Qaida first target the World Trade Center and Al Gore make the case for raising taxes on the top 1 percent? It was 19 years ago, 1993.

And now we honor our fellow Americans who serve and sacrifice. This week, the Pentagon released the names of three soldiers killed in Afghanistan.

And in "Your Voice This Week," today's question comes from Gwen Romack, who asks, what are the best sources to get accurate, non-politicized, untwisted information, actual facts put in context, about the candidate's position on key issues?

It's a good question. First place to go, candidates' websites. Go to the horses' mouths. Yes, it's their spin, but it belongs to them, and they own it.

There are some independent sites. C-SPAN has a great resource. PolitiFact, FactCheck.org, Project Vote Smart, they all try to play it right down the middle. And I've got to say this, our own great site at abcnews.com, go to Otus, Otus. It really is a great source for this kind of information.

And that is all for us today. Check out "World News" with David Muir tonight. And tune in tomorrow -- this is exciting -- the debut of "Good Afternoon America," with hosts Josh Elliott and Lara Spencer.

Thanks for sharing part of your Sunday with us. George Stephanopoulos will see you back here next week.